Professional Home Inspections: Obtaining a professional home inspection is the single most important thing a buyer can do for their protection. A professional home inspection report will provide the buyer with detailed information about the home’s physical condition, its systems and fixtures and usually note any potential future problems. The buyer should carefully review an inspector’s proposal to determine the scope of the inspection. Some home inspectors may not inspect heating and cooling systems, the roof or other systems or components. A home inspection should be done by a home inspector or contractor licensed by the State of Connecticut. Inspection of property is beyond the scope of expertise of a Sales Agent, but Sales Agents can provide buyers with a list of local inspectors. Sales Agents ordinarily will not recommend a specific inspector. Most residential sale contracts contain a clause that allows the buyer to withdraw from the agreement if a professional inspection they have done shows defects in the property. You will want to take advantage of this important right by obtaining your own professional home inspection report from a licensed professional inspector within the time frame specified in the sale contract. The cost of the inspection will not be refunded should you withdraw from the Agreement.
Wood Destroying Insect (WDI) Inspections: WDI inspections are done in many residential real estate transactions and may be required by the lender. A WDI inspection may or may not be included in a whole home inspection. If a WDI inspection is desired or required and the buyer is obtaining a whole home inspection, the buyer should verify that the inspection obtained covers WDI and the inspector is properly licensed. Sales Agents do not have the training or expertise to inspect property for WDI. Like any property condition report, buyers should not rely on the report of an inspector they did not hire. A WDI inspection is a limited inspection and is no substitute for a complete whole home inspection by a licensed home inspector.
Defective Products and Materials: Some materials used in home construction are, or have been, subject to a recall, class action suit, settlement or litigation. These materials are typically, but not limited to, modern engineered construction materials used for siding, roofing, insulation or other building purposes. It is critical that a buyer carefully review any disclosures or representations of the seller regarding such materials. A Sales Agent may assist the buyer in that review, but inspection of property for defective products, systems, fixtures or materials is beyond the scope of expertise of a Sales Agent. The buyer, therefore, should make certain inspection for such materials is within the scope of any home inspection ordered by the buyer. Like any property condition report, buyers should not rely on the report of an inspector they did not hire. A Sales Agent can help the buyer find a suitable inspector.
Repairs and Remodels: Buyers should look for signs of repairs or remodeling when viewing property. If repairs or remodeling have been done, the buyer will want to make certain the work was properly done. Buyers can ask the seller for any invoices or other documentation for the work but, as with other questions of property condition, there is no substitute for professional inspection. A Sales Agent can help the buyer assess the need for a building code compliance inspection but do not themselves have the training or expertise to evaluate building code compliance. If building permits were required for work done on the property (such permits are typically required for structural changes, new additions, and new plumbing and electrical work), the buyer should check with the city or town building department to make sure the permits are in order. If permits were not properly obtained, the new property owner could be held responsible. If repairs or remodels have been completed very recently, the buyer should take steps to determine if there is any possibility of construction liens being filed against the property after the sale has closed. This can be done by the buyer raising the issue with their attorney. Sales Agents are not trained or experienced in construction lien law and cannot interpret legal documents or give legal advice. If any repairs are being required during the transaction, the buyer should ensure a licensed construction contractor is doing the repairs. After the repairs have been done, the buyer should consider having a re-inspection done to assure the repairs were done properly.
Radon: Radon is a naturally occurring radioactive gas that, when it has accumulated in a building in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of radon that exceed federal and state guidelines have been found in buildings in Connecticut. Sales Agents do not have the expertise to advise buyers on radon testing requirements but can often direct buyers to the appropriate professionals.
Septic Systems: It is important to determine if the property is connected to a city sewer or if the property is serviced by a septic system. The buyer should always verify the type of sewage system present on the property even if this information is provided in the MLS data sheet or Seller’s Property Disclosure Statement. Sales Agents are not licensed to do plumbing or septic inspections. If the property is serviced by a septic system, a septic system inspection should be completed by an approved Inspector.
Wells: If domestic water for the property is supplied by a private well, they should test the well for total coliform bacteria, nitrates and arsenic through an accredited laboratory. The buyer should verify to the extent possible whether the well provides adequate water for domestic needs. It is strongly recommended that a well flow test be conducted prior to the purchase of any property that depends on a well for domestic water.
Underground Oil Storage Tanks: Buyers should be aware of potential problems associated with underground oil storage tanks. Home heating oil tanks can cause serious problems if they have leaked oil, and cleanup can be expensive.
Environmental Hazards: Buyers should carefully review the Seller’s Property Disclosure Statement and any inspection reports available to determine if any of a number of potential environmental hazards may require further investigation. Environmental hazards include everything from expansive soils to landslides, forest fires, tsunamis, floods and earthquakes. Environmental hazards can also include indoor air quality (e.g., radon, mold, or carbon monoxide) and hazardous materials, like asbestos. Buyers concerned about external environmental hazards should check with the town in which the property is located. Flood plain maps and information are available from the Federal Emergency Management Agency (FEMA). The Environmental Protection Agency (EPA) provides a great deal of information about indoor hazards on its website and can be found here. Superfund sites are areas that have been listed by the federal government as contaminated. A wealth of information on superfund sites, including their locations, is available by visiting the EPA’s website. Sales Agents are not trained, and do not have the expertise, to discover and evaluate environmental hazards. Buyers, therefore, are advised to hire appropriately trained environmental professionals to inspect the property and its systems or fixtures for environmental hazards.
Fireplaces & Woodstoves: Inspection of fireplaces and woodstoves requires special training and expertise. Although a Sales Agent may be able to help you find a local professional, they cannot themselves inspect or evaluate a fireplace or woodstove.
Mold: Molds are one of a variety of biological contaminants which can be present in human structures, including in residential housing. Some molds have been identified as possible contributors to illness, particularly in infants, elderly, and people with suppressed immune systems and those with allergies or asthma. Such cases usually involve property with defective siding, poor construction, water penetration problems, improper ventilation or leaking plumbing. In a few cases, these problems have led to the growth of molds which caused medical conditions in some people. Buyers, if concerned about potentially harmful molds, should arrange for inspection by a qualified professional. Inspection, discovery and evaluation of specific water intrusion or mold problems requires extremely specialized training and is well beyond the scope of a Sales Agent’s expertise. Buyers are advised to hire appropriately trained professionals to inspect the property if the buyer is concerned about the possibility of harmful molds.
Deaths, Crime, and External Conditions: In Connecticut, certain social conditions that may be of concern to buyers are considered not to be “material” by state law. Ordinarily, “material facts” must be disclosed by the seller or the seller’s agent. Because state law declares certain facts that may be important to a buyer to be not material, buyers cannot rely on the seller disclosing this kind of information. Buyers should undertake their own investigation if concerned that the property or a neighboring property has been the site of a death, crime, political activity, religious activity, or any other act or occurrence that does not adversely affect the physical condition of, or title to, real property, including that a convicted sex offender resides in the area. Concerned buyers can contact their local police for more information.
Neighborhoods: Neighborhoods change over time so a buyer cannot expect the area surrounding their home to stay as it is. Buyers concerned about potential development in the surrounding area should check with governmental authorities to determine if any large-scale building projects are scheduled for the area. Building permits, zoning applications and other planning actions are a matter of public record. In Connecticut, local governments must develop comprehensive plans that guide development over long periods of time. If concerned about development, buyers should check with local government planning departments. Location within a school district can be an important attribute of a neighborhood. School boundaries, however, are subject to change. If location within a particular school district is material to the purchase of real property, the buyer should investigate the boundaries and the likelihood of change by contacting the school district directly.
Short Sale Properties: A short sale is any sale where the purchase price will not result in sufficient proceeds to pay off the mortgage, or other liens, and clear the title. Short sales are typically made using a short sale addendum that makes the transaction contingent upon the seller obtaining the consent from their creditors permitting a reduction in the closing costs sufficient to close the transaction for the purchase price. Because the transaction is contingent upon the consent of third parties, short sales often fail. Buyers should understand and plan for the resulting uncertainty. Contract deadlines and termination provisions must be carefully considered in a short sale. Because the transaction is contingent on the consent of one of more third parties, sellers can, and often do, continue to market the property and seek better offers. Creditors will often demand changes in the terms of the sale agreement as a condition of giving their consent. Buyers should be prepared to deal with the additional uncertainty created by the potential for multiple offers and third-party demands. Sales Agents can give buyers important marketing, business and negotiating advice and information and can assist in preparation of the sale agreement but only pursuant to the client’s instructions. Sales Agents are not attorneys and are prohibited by law from giving legal advice.
Real Estate Owned Properties: When a lender forecloses on a property, obtains title in lieu of foreclosure or otherwise obtains title to real property as a result of a mortgage or lien, the property becomes what is called “Real Estate Owned” or REO property. Lenders typically sell REO property using the same listing and marketing techniques as ordinary home owners. REO property, however, is almost always sold using forms and procedures developed by the lender. Such forms and procedures can significantly affect a buyer’s rights and obligations in the transaction. For instance, many REO forms delay formation of the contract until right before closing, or otherwise reserve to the seller the right to cancel the contract. Buyers should understand and plan for the resulting uncertainty. REO forms typically contain very detailed clauses that shift responsibility for the condition of the property to the buyer and make it difficult or impossible for the buyer to sue the seller if a defect is discovered after closing. Sales Agents can give buyers important marketing, business and negotiating advice and information and can assist in preparation of the sale agreement but only pursuant to the client’s instructions. Sales Agents are not attorneys and are prohibited by law from giving legal advice.
Information Generally: Information from third parties contained in the many documents associated with a real property transaction is not independently verified by Sales Agents. It is the responsibility of the buyer to read the documents provided and ask questions if uncertain or concerned. Interpretation of many real property transaction documents involves the practice of law and is, therefore, beyond the scope of a Sales Agent’s expertise. Buyers uncertain about the legal effect of documents should consult an experienced real estate attorney.
MLS Information: Most properties marketed for sale by Sales Agents are listed in a Multiple Listing Service (MLS). Information about the listing, provided to the MLS by the listing broker, is made available to all subscribing members of the MLS. This information is typically contained in what is called an MLS “printout” or “data sheet.” Most of the information contained in an MLS data sheet or printout is obtained from the seller or third-parties like the town assessor’s office or other governmental entity. MLS data may be incomplete, an approximation or otherwise inaccurate. Personal property cited on the MLS data sheet should be included in the purchase agreement if the buyer wishes to have the personal property included in the sale. Buyers should not rely on MLS provided information, if that information is considered an important factor in the Buyer’s decision to purchase the property. It is the buyer’s sole responsibility to verify this information.
Seller’s Property Condition Disclosure: In most cases, residential property sellers in Connecticut must provide a Residential Property Condition Disclosure Report to each residential buyer who makes a written offer. The form used by the seller is mandated by state law. The seller’s representations regarding the property are based upon the seller’s actual knowledge at the time the disclosure statement is made and are not the representations of any financial institution that may have made or may make a loan pertaining to the property, or that may have a security interest in the property, or any Sales Agent engaged by the seller or buyer. Sales Agents are not responsible for misrepresentations by the seller unless they know of the misrepresentation and fail to disclose it. A buyer should carefully review the seller’s disclosures and verify, or ask their Sales Agent to verify, any statements of concern. While a Sales Agent can get clarification from the seller as to statements on the seller’s disclosures, Sales Agents cannot inspect or warrant the condition of the property. Review of the seller’s property disclosure statement is no substitute for professional inspections. Your Sales Agent will provide you with the Residential Property Condition Disclosure Report completed by the seller.
Real Estate Purchase and Sale Agreement: A contract for the sale of real property must be in writing to be enforceable in a Connecticut court. A verbal offer or acceptance should not be made or relied upon.Contracts for the sale of property are often called “Purchase and Sale” agreements. They are legally binding contracts. Buyers and sellers should seek competent legal advice before signing any contract they do not fully understand. Sale agreements usually include provisions concerning who will hold the earnest money and under what conditions it may be refunded to the buyer or forfeited to the seller. Both buyers and sellers should carefully review these provisions. The amount of earnest money pledged and the conditions under which it may be refunded or forfeited are important matters that should be carefully negotiated between the buyer and the seller. Most sale agreements are written using a standard form. Buyers and sellers are responsible for selecting the terms and conditions of their agreement. The forms are designed to address the most common issues that come up in a real estate transaction. Modifications to the sale agreement can be accomplished through addendums. While Sales Agents can give buyers important marketing, business and negotiating advice and information and can assist in preparation of the purchase and sale agreement, Sales Agents are not attorneys and are prohibited by law from giving legal advice.
Financing / Loan Information & Documents: The buyer’s ability to finance the property is an important contingency in most residential transactions. Buyers must act in good faith and use best efforts to obtain a loan if the sale is contingent upon obtaining a loan. Buyers often seek pre-approval from a lender prior to writing an offer. A pre-approval letter should state that the lender has reviewed the buyer’s credit report, income requirement and cash to close and pre-approves the buyer for the loan, subject to an acceptable appraisal of the property. The appraisal is conducted by a third party and will normally be ordered by the lender, with the buyer’s approval and authorization for payment. Once the appraisal has been received, the underwriter authorizes final loan approval. Only when the underwriting process is completed will an actual loan be secured. The entire financing process normally takes approximately 30-45 days.
Title Search: The buyers attorney will conduct a title search to verify marketability and identify any easements, covenants or other restrictions.
Homeowner’s Association Documents, Covenants, Conditions and Restrictions: Covenants, conditions and restrictions, called “CC&Rs,” are formally recorded private limitations on the right to use real property. Often, but not always, CC&Rs are enforced by a homeowners’ association. Review of the CC&Rs is typically part of a real estate sale. Although Sales Agents are familiar with common CC&R provisions, determining the legal effect of specific provisions is considered the practice of law in Connecticut and, therefore, beyond the expertise of a Sales Agent. If the subdivision in which the property is located is governed by a homeowners’ association, the CC&Rs may be very restrictive. Homeowners’ associations are often governed by their own articles of incorporation, bylaws, rules and regulations. Homeowners’ association rules and regulations can significantly impact a buyer’s plans for the property the buyer wants to purchase. Planned communities and condominiums are very likely to have detailed homeowners’ association governing documents, mandatory fees and ongoing homeowner obligations. Governing documents, fees and homeowner obligations should be reviewed by the buyer during the transaction. There may be costs associated with requesting HOA documents. If purchasing a condo your Sales Agent will use a condominium addendum.. This document contains language creating contractual rights and responsibilities related to producing and paying for HOA documents and includes provisions on if and when the buyer can terminate the transaction and receive an earnest money refund based on disapproval of the HOA documents. Review these provisions carefully. If you have questions about CC&Rs or your legal rights and remedies under homeowners’ association governing documents, you should have your attorney review the documents for you. A Sales Agent is prohibited by law from giving legal advice.
Homeowner’s Insurance: It is critical that buyers arrange for homeowners’ insurance early in the process of purchasing property rather than waiting until closing to get insurance.
Flood Insurance: Your mortgage lender may require you to purchase flood insurance in connection with your purchase of a property. The National Flood Insurance Program provides for the availability of flood insurance but also establishes flood insurance policy premiums based on the risk of flooding in the area where properties are located. Due to recent amendments to federal law governing the NFIP those premiums are increasing, and in some cases will rise by a substantial amount over the premiums previously charged for flood insurance for the property. As a result, you should not rely on the premiums paid for flood insurance on a property previously as an indication of the premiums that will apply after you complete your purchase. In considering your purchase of the property you should consult with one or more carriers of flood insurance for a better understanding of flood insurance coverage, the premiums that are likely to be required to purchase such insurance and any available information about how those premiums may increase in the future. Sales Agents do not have the expertise to assess flood potential and probable insurance premiums.
Home Warranty Policy: A home warranty is a service contract. Home warranties for existing homes are common in today’s real estate market. The warranty generally covers the repair and replacement of equipment and appliances such as dishwashers, plumbing systems, electrical systems, and so on. Optional coverage may be available at additional costs for pools, built-in spa equipment, well pumps and other systems. Coverage and price vary considerably among warranty companies. Be aware that pre-existing property conditions are generally not covered. The length of coverage can vary but is often one year. Buyers should discuss home warranties with their agent prior to purchasing a home. In addition, buyers should thoroughly read the home warranty contract to understand coverage, limitations, exclusions and costs associated with the policy. Your Sales Agent can provide you with information on companies offering home warranties for purchase.
Square Footage and Acreage: The square footage of structures and acreage data found in MLS printouts, assessor records and the like are usually just estimates and should not be relied upon. Many Connecticut properties have not been surveyed and their exact boundaries are not known. If square footage or land size is a material consideration in a purchase, all structures and land should be measured by the buyer or a licensed surveyor prior to entering into a purchase and sale agreement, confirmation of square footage and/or land size should be made an express contingency of the agreement.
Lead-Based Paint Disclosure Form: Residential property built before 1978 (called “target” housing) is subject to the Residential Lead-Based Paint Disclosure Program administered by the Environmental Protection Agency (EPA) and the Department of Housing and Urban Development (HUD). The Act requires sellers of target housing to provide the buyer with a lead-based paint disclosure and the pamphlet entitled “Protect Your Family From Lead in Your Home”.
Historic Property: It is important for the buyer to determine whether a property is considered a historic property or in a historic district and therefore subject to any special zoning restrictions.
Smoke / Carbon Monoxide Alarms: Sellers will be asked to sign an affidavit at closing concerning smoke and carbon monoxide detectors. CT law requires that the seller provide the affidavit or give the buyer a $250 credit against the purchase price at closing. In the affidavit, the seller will swear under oath that the property is equipped with smoke and carbon monoxide detectors, and that the detectors are in working order as of the date of the closing.
Concrete Foundations: Foundation cracks, problems or failures may be a result of many factors including but not limited to chemical compositions in foundation materials or natural occurrences at any time during the life of a property. Recent reports of issues with concrete foundations in some residential homes and condominium complexes in Connecticut prompted the State of Connecticut’s Department of Consumer Protection (DCP) to develop information for consumers and to conduct an investigation to identify the extent and scope of the issue, as that is not fully identified. Professional Engineers can provide guidance and expert assistance into aspects of foundation problems and concerns.